The Rugby Football Union (RFU) confirmed at the weekend the 31-year-old would be free to play against Scotland on February 4 after he was handed a four-match ban for a dangerous tackle while playing for club side Saracens earlier this month.
Borthwick, himself a former England captain, spoke on Monday about Farrell's enduring leadership qualities as he unveiled his first squad since succeeding Eddie Jones in December.
"To have a team that finds a way to win, you need great leaders across the squad," said the 43-year-old.
"The first time I walked into an England squad and onto the training field as a young man, the leaders - Martin Johnson, Lawrence Dallaglio, Richard Hill, Neil Back, Phil Vickery, Jason Leonard, Matt Dawson. Incredible.
"The England rugby team is going to be captained by Owen Farrell."
The former lock saw Farrell take his first steps in senior rugby when they were both playing for Saracens in the English Premiership.
"It's normal that when a 17 or 18-year-old enters first-team training at the start of their careers, they are quiet, reserved," he said. "Owen's different.
'Struck with awe'
"Owen came onto the training field and everyone was struck with awe by how hard he pushes himself. Everybody was also struck by how much he demanded of those around him. That's Owen - it's what he does and why he is captain of the England rugby team."
The RFU said on Saturday that Farrell's ban would be deemed fully served before the Six Nations starts next month despite initial uncertainty over when he would be available.
The four-match suspension would have prevented Farrell, who plays at fly-half or centre, from running out at Twickenham in Borthwick's first match in charge.
However, there was provision for the ban to be reduced to three weeks if Farrell completed the World Rugby coaching intervention programme.
Rugby chiefs clarified on Saturday that Farrell would be available for Saracens' game against Bristol on January 28, even if in reality he is highly unlikely to play in the match a week before the Scotland game.
The Bristol fixture effectively becomes the final game of his suspension.
The RFU has been accused of "gaming" their own system by including the Premiership match as part of Farrell's punishment.
Borthwick, who was updated on the situation on Friday, said: "The England head coach and the disciplinary system should be completely separate, and that's the case."
England's new defence coach Kevin Sinfield, who worked alongside Borthwick when they guided Leicester to the Premiership title last season, said Farrell, who has won 101 England caps, could change a tackling technique that has caused controversy during his career.
"I think right across the sport we know we need to change," said Sinfield, with concerns growing over the long-term health effects of head-high challenges.
"Owen fully accepts he needs to change and is willing to work extremely hard at it."
